UBB criminal probe may target ex-Massey executives

CHARLESTON, W.Va. -- Former Massey Energy executives and board members "may be, or may become" targets in the ongoing federal criminal investigation of the Upper Big Branch Mine Disaster, prosecutors said in court documents filed this week.

U.S. Attorney Booth Goodwin made the disclosure to support an effort to continue a court-ordered stay on a civil suit brought against former Massey officials by former shareholders who alleged they were misled about the company's safety record.

Goodwin and Assistant U.S. Attorney Fred Westfall argue that allowing the civil case to proceed could hamper the criminal probe, by giving potential targets access to evidence collected by government agents in the criminal investigation.

"Individual defendants in this civil action may be, or may become, subjects or targets in the criminal investigation," Goodwin and Westfall said in a motion filed Monday in U.S. District Court in Beckley.

If the civil case -- particularly the "discovery" of documents -- is allowed to proceed, the prosecutors argue, potential criminal defendants "will be able to use the discovery process to obtain much of the evidence that is at the heart of both this matter and the criminal investigation.

"With that evidence, they will be able to draw informed conclusions about key details of the government's case -- to learn what the government knows," the prosecutors said. "That information could, in the worst case, allow the individual civil defendants to shape their own statements to the criminal investigation or to influence the testimony of other witnesses, thus obstructing the criminal investigation."

Prosecutors and parties to the civil case made a similar statement -- that civil defendants "may be potential targets in the criminal investigation" -- in a court filing in July 2012.

But this time, Goodwin and Westfall asked U.S. District Judge Irene Berger to schedule a closed-door hearing so that prosecutors could privately brief the judge on how allowing the civil case to move forward might affect the criminal probe.

"The United States recognizes that the court, in considering this motion, may benefit from an explanation of the specific aspects of the criminal investigation that would be jeopardized if discovery proceeds now in this civil action," the prosecutors said. "Public disclosure of details of the criminal investigation, however, would be inappropriate; if individuals learn that they are subjects or targets of the investigation and discover the evidence against them, they would be in a position to undermine the investigation by, for example, influencing witnesses."

The prosecutors added, "It is well established that preserving the integrity of criminal investigations may require non-public judicial proceedings: grand jury secrecy and the sealing of search warrant affidavits are two commonplace examples."

An existing stay on the civil case, ordered by Berger in January, expired on Monday.

On Friday afternoon, the judge extended that stay until next Thursday, when she said she would hold the closed-door hearing requested by Goodwin and Westfall.

The civil case was filed by the Massachusetts Pension Reserve Investment Trust, which held shares of Massey Energy stock. Defendants in the case include Massey Energy, former CEO Don Blankenship, former President Baxter Phillips, former Vice Presidents Eric Tolbert and Chris Adkins, and former board members Richard Gabrys, Lady Barbara Thomas Judge, Dan Moore, James Crawford, Robert Foglesong. E. Gordon Gee and Stanley Suboleski.

Last year, the defendants tried unsuccessfully to have the civil case dismissed and have said in court documents that they did nothing wrong. In a report released in June 2011, the Massey board argued the April 5, 2010, explosion that killed 29 miners was the result of an uncontrollable inundation of methane gas that the mine operator could not have foreseen or prevented.

But four government and independent investigations blamed the Upper Big Branch deaths on a pattern by Massey Energy of violating federal standards concerning mine ventilation and the control of highly explosive coal dust, both of which set the stage for a small methane ignition to turn into a huge, coal dust-fueled explosion.

Goodwin reached a deal not to prosecute Alpha Natural Resources for any Upper Big Branch criminal liabilities that it inherited when it purchased Massey Energy in June 2011. That deal required the firm to spend $80 million during the next two years on mine safety improvements and create a $48 million mine safety research trust fund. Alpha also agreed to pay $46.5 million in restitution to families of the disaster victims and $35 million to resolve pending Massey safety fines, including $10.8 million levied for violations related to the Upper Big Branch explosion.

So far, one former Upper Big Branch miner, a former mine superintendent and a mine security chief have gone to prison. An official from another Massey mine is awaiting sentencing after pleading guilty in a deal to cooperate with prosecutors.

During a plea hearing in February, that other Massey official, David C. Hughart, alleged that Blankenship was part of a decade-long conspiracy to hide safety violations from federal inspectors.

Through his lawyer, Blankenship has said he did nothing wrong.

In January, during a sentencing hearing for former Upper Big Branch superintendent Gary May, Berger held a private bench conference discussion with prosecutors and May's lawyer to hear them explain how May has, as part of a plea agreement, cooperated and will continue to help prosecutors in the investigation.